Fortunately, there is little evidence that the stock market will suffer very much in 2013 for that naughtiness.

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First the numbers: Since 1896, when the Dow Jones Industrial Average
DJIA, -1.11%
was inaugurated, it has produced an average gain of 1.06% between Christmas and New Year’s — far higher than the average weekly gain of just 0.12% for the rest of the calendar.

Nor can this outsized average be traced to one or two outliers. The Dow between past Christmases and New Year’s Days has risen 4 out of 5 times, compared with a 54% probability of gain for other weeks of the year.

Not this time around, however: The Dow fell 0.27%. And the market’s loss would have been a lot greater than even this but for a rally in the last couple hours of trading on Dec. 31.

You might be quite worried about Santa’s decision to stay away from Wall Street. Indeed, this concern is memorialized in a saying on Wall Street: “If Santa fails to call, bears may come to Broad and Wall.”

And though there are, no doubt, numerous good reasons to worry about a bear market in 2013, I could not find any historical support for basing such concern on Santa Claus’s failure to call.

If Dow between Christmas and New Years...

Next 1 Month

Next 3 Months

Next 6 Months

Next 12 Months

Rises

0.7%

1.4%

2.6%

7.1%

Falls

1.9%

2.0%

4.8%

8.2%

The data in the accompanying table summarizes the Dow’s behavior back to its creation in 1896. Notice that the stock market actually has performed somewhat better, on average, following periods in which the Dow fell rather than rose between Christmas and New Year’s.

To be sure, given the variability in the year-by-year results, these differences are not significant at the 95% confidence level that statisticians often use to determine that a pattern is genuine. So these results should not be used to conclude that the stock market’s odds in 2013 are now better than they were before.

But you can conclude, with statistical confidence, that if there is a bear market in 2013, it has nothing to do with how the Dow performed between Christmas and New Year’s.

Intraday Data provided by SIX Financial Information and subject to terms of use.
Historical and current end-of-day data provided by SIX Financial Information. Intraday data
delayed per exchange requirements. S&P/Dow Jones Indices (SM) from Dow Jones & Company, Inc.
All quotes are in local exchange time. Real time last sale data provided by NASDAQ. More
information on NASDAQ traded symbols and their current financial status. Intraday
data delayed 15 minutes for Nasdaq, and 20 minutes for other exchanges. S&P/Dow Jones Indices (SM)
from Dow Jones & Company, Inc. SEHK intraday data is provided by SIX Financial Information and is
at least 60-minutes delayed. All quotes are in local exchange time.